Jannah Theme License is not validated, Go to the theme options page to validate the license, You need a single license for each domain name.
United Kingdom

UK interest rates may not rise as much as expected. Pound rises as Liz Truss resigns – Business Live | Work

Hit higher when Truss’s “Sorry Domination” ends

The pound is still 0.5 cents higher at $1.126 as investors digest Liz Truss’ resignation, reaching $1.13 on news of her resignation.

As Market.com’s Neil Wilson points out, the prime minister’s “disappointing reign” is over, but there is still great uncertainty over whether the Tories will be able to stay in power.

pound vs us dollar today Photo: Refinitiv

That uncertainty means there is no firm movement in the market ( FTSE 100 is now back in the red for the day.

Wilson wrote:

The market lacks a ton of real new information, despite the seismic events of the last 24 hours, as economic policy was already in the water.

Wilson suggests that Truss’ decision to step down may allow the new leader to complete his term in Congress. It could be the Rishi Sunak/Jeremy Hunt ticket – meaning financial restraint.

Wilson also added that the market “probably prefers the orthodox unilateral Tory economy” over anything else.

important event

filter beta

Capital Economy: New Prime Minister Must Work Hard to Restore Confidence

The resignation of Liz Truss as Prime Minister leaves Britain without a leader at a time when the country faces enormous economic, fiscal and financial market challenges, but markets appear relieved, it wrote. There is Paul DalesChief UK Economist capital Economy.

The pound rose from $1.12 to $1.13 and the 30-year coin yield fell further to 3.90% from 3.95%.

In other words, the market is further depreciating the risk premium created by the Truss government. There are still many uncertainties, but the lesson is certainly that the economic, fiscal and financial context is important.

Dales Also, as Jeremy Hunt took charge of the Treasury and “almost erased from history” the truss and kwasi-kwarten tax regimes, fiscal policy went from super lax to lax to totally tight in just a few weeks. It also points out that it has changed.

But the new prime minister and his prime ministers have the big task of navigating the economy through “the cost of living crisis, the debt crisis, the cost of the credit crisis.” Dales conclude.

Liz Truss resignation will help calm markets, predict Chris Beauchamp chief market analysttIG group.

The pound’s initial gains have begun to wane as the effects of yet another period of uncertainty seep in.

Perhaps with Rishi ready to step in and Hunt in line with him, we can expect a very different approach, but one that will likely please the market.

Prime Minister Jeremy Hunt has managed to restore economic confidence, but warns there is still a long way to go before political confidence is restored. Victoria Scholarinvestment director interaction Investor:

The pound is trading higher as investors welcome Truss’ resignation and the possibility of a more economically savvy, market-friendly leader, looking to recapture the two-week highs recorded earlier this week. increase.

Sterling’s strength weighs heavily on the FTSE 100, with major UK export stocks such as Diageo and Coca-Cola struggling near the bottom of the UK index.

Given the ongoing political uncertainty, the growing risk of a recession, and persistent inflation problems in the UK, where prices are at their highest level in 40 years, the UK as an investment destination still has plenty to offer. You should be careful.

Hit higher when Truss’s “Sorry Domination” ends

The pound is still 0.5 cents higher at $1.126 as investors digest Liz Truss’ resignation, reaching $1.13 on news of her resignation.

As Market.com’s Neil Wilson points out, the prime minister’s “disappointing reign” is over, but there is still great uncertainty over whether the Tories will be able to stay in power.

GBP vs USD
pound vs us dollar today Photo: Refinitiv

That uncertainty means there is no firm movement in the market ( FTSE 100 is now back in the red for the day.

Wilson wrote:

The market lacks a ton of real new information, despite the seismic events of the last 24 hours, as economic policy was already in the water.

Wilson suggests that Truss’ decision to step down may allow the new leader to complete his term in Congress. It could be the Rishi Sunak/Jeremy Hunt ticket – meaning financial restraint.

Wilson also added that the market “probably prefers the orthodox unilateral Tory economy” over anything else.

Liz Truss announces resignation as UK Prime Minister

Liz Truss resigns as prime minister.

In a brief statement outside Downing Street, Truss (who took office just 44 days ago) said he had notified King Charles of his resignation as prime minister.

There will be a leadership contest, which will be completed within the next week, and Truss will remain until a successor is chosen.

Our political live blog has all the action for another day of turmoil in Westminster:

The stock market actually retreated a bit, but the UK-focused FTSE The 250 is still up 0.6% today and the pound is still trading near $1.13.

Update: Here is the full text of Liz Truss’ resignation letter:

I took office at a time of great economic and international instability.

Families and businesses were worried about how their bills would be paid.

Putin’s illegal war in Ukraine threatens the security of our entire continent.

And our country has been held back for too long by low economic growth.

I was elected Conservative with a mission to change this.

We realized a reduction in utility bills and national insurance.

And he laid out a vision of a low-tax, high-growth economy that takes advantage of Brexit freedom.

However, given the circumstances, I am aware that I will not be able to fulfill the duties of being elected by the Conservative Party.

I have therefore spoken with His Majesty the King and informed him of my resignation as Conservative Party Leader.

This morning I met Sir Graham Brady, Chairman of the 1922 Commission.

We agreed to hold a leader election next week.

This will ensure that we continue to implement our financial plans and stay on track to maintain the country’s economic stability and national security.

I will remain as Prime Minister until a successor is decided.

Thank you very much .

London stocks are rising following news that Liz Truss will make a statement outside number 10.

of FTSE The 250 index of smaller, more domestically focused stocks was up 0.8% today.

FTSE 250
FTSE 250 Index Today Photo: Refinitiv

The FTSE 100 Index rose 0.3%, led by Lloyds Bank (+4.4%).

Speak by hitting high like a truss

The pound rose following reports that Liz Truss will make a statement about her future outside 10 Downing Street at 1:30pm.

The pound is now up two-thirds of a cent at $1.128, its highest since yesterday morning.

GBP vs USD this week
GBP vs USD this week Photo: Refinitiv

A spokesperson for the prime minister told reporters today that Truss would remain in office after the October 31 fiscal report.

The pound hit a high of the day after many Conservative MPs revealed they had lost faith in the prime minister.

Stirling rose 0.3 cents to the session high of $1.125 after Hartlepool Conservative MP Jill Mortimer said he had submitted the letter.

Jill Mortimer, the redwall MP who won Hartlepool under Johnson, has sent a letter of no confidence to FB. pic.twitter.com/0WYy3uNLUO

— Beth Rigby (@BethRigby) October 20, 2022

🚨 Jill Mortimer becomes 15th Conservative MP to call for Liz Truss to resign

— Alix Culbertson (@alixculbertson) October 20, 2022

Sir Graham BradyChairman of the 1922 Backbench MP Committee.

Kariena Makourtoff

Kariena Makourtoff

National Express reports further recovery in passengers and increased revenues after stepping up services during rail strikes and assisting shuttle police during the Queen’s funeral.

The coach and bus operator said revenues were up 33% in the three months to the end of September, now above 2019 levels, thanks to strong growth in its coach business in the UK and Spain.

In the UK, the company said demand was partially driven by industrial action on the country’s rail network.that included the month of august Strike by railway operators It has stopped intercity trains across the UK.

ING’s James Smith also believes UK interest rates will peak above the 5% the market had priced in.

of @bankofengland There is an option to aggressively raise interest rates and entrench ultra-high mortgage/corporate rates.Or underperform market expectations and risk a weaker sterling and higher inflation

As is evident from his speech, Governor Broadbent sees the latter as the lesser of two evils. pic.twitter.com/KxcXNBVcTE

— James Smith (@SmithEconomics) October 20, 2022

The head of the CBI has warned that the UK’s growth engine is coming to a halt in some places. This is because political instability has confused business owners and made them reluctant to invest.

Tony Dunker (Who once hailed the mini-budget as an economic ‘turning point’*) stated that political and market stability is needed.

This means companies can grow. That means more jobs and tax revenues, and less need to cut public spending or increase taxes.

* – Unfortunately, in many ways it was.

Politics is a little broken. Let me explain why it matters. 1/8

— Tony Dunker (@tonydanker) October 20, 2022

Within 10 days, the country should decide to cut public services and/or increase taxes for everyone. probably both. The most important principle is to protect those in our society who need it most. 2/8

— Tony Dunker (@tonydanker) October 20, 2022

The only way to avoid this pain is to boost economic growth. Growing businesses pay more taxes, pay higher wages, and create more jobs. More tax revenue means less tax cuts. 3/8

— Tony Dunker (@tonydanker) October 20, 2022

Today, the UK’s growth engine – companies investing more in products, services and people – is coming to a halt in some places. Political instability worries business owners – what about taxes? What will the money be spent on? What will be cut? 4/8

— Tony Dunker (@tonydanker) October 20, 2022

Many companies want to invest – they have the money and the plans – but my estimate is that until this political turmoil is cleared and there is a clear government plan and market stability. About half don’t press the button. 5/8

— Tony Dunker (@tonydanker) October 20, 2022

Market stability is important as it affects interest rates. It’s important to everyone’s bills and mortgages, and it hits businesses as well. Most businesses in the country borrow money to invest, so if interest rates rise too fast or too high, they will simply stop investing. 6/8

— Tony Dunker (@tonydanker) October 20, 2022

Political and market stability will give business owners the headspace and transparency to put their plans into action. And governments need to tap into all the ingredients that enable growth: immigration reform, better planning regimes, more clean energy projects, etc. 7/8

— Tony Dunker (@tonydanker) October 20, 2022

That is why we will continue to urge governments to help the hardest hit and continue to grow. This is the only way to minimize spending cuts and tax increases. And recessions are short and shallow. And this is not repeated. 8/8

— Tony Dunker (@tonydanker) October 20, 2022

The broadbent effect is: Market expectations of interest rate hikes are dropping.



https://www.theguardian.com/business/live/2022/oct/20/cost-of-living-crisis-uk-economy-millions-skip-meals-sterling-bonds-business-live UK interest rates may not rise as much as expected. Pound rises as Liz Truss resigns – Business Live | Work

Back to top button